Bouygues Offshore 1999 Net Income Increased 23% to Euro 52.1 million -US$ 52.3 Million-; Earnings Per Share Increased 24% to Euro 3.11.Business Editors MONTIGNY-LE-BRETONNEUX Montigny-le-Bretonneux is a commune in the southwestern suburbs of Paris, France. It is located 24.5 km. (15.2 miles) from the center of Paris, in the "new town" of Saint-Quentin-en-Yvelines, created in the 1960s, of which it is the central and most populated commune. , France--(BUSINESS WIRE)--March 8, 2000 Bouygues Offshore S.A. (NYSE NYSE See: New York Stock Exchange :BWG BWG Bankwesengesetz (Federal Law on Banking, Austria) BWG Beam Waveguide (antenna) BWG Bundesamt für Wasser und Geologie (Federal Office for Water and Geology, Switzerland) ) reported financial results for the year ended December 31, 1999. As previously reported, net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight (2) increased 16% to Euro 983.7 million (US$ 988.2 million)(1), compared to 1998 net sales of Euro 849.8 million. Sofresid, which was consolidated during the second half of 1999, accounted for Euro 88.5 million of net sales in 1999. Net income for the year was Euro 52.1 million (US$ 52.3(1) million), a 23% increase compared to 1998. Earnings per share increased 24% to Euro 3.11 compared to Euro 2.50 in 1998. Research and development expenses increased 46% to Euro 5.7 million, due to the development of new solutions for deep offshore development, particularly the testing of the Company's Multifunction Barge Concept (MFB MFB Michigan Farm Bureau MFB Metropolitan Fire Brigade (Australian non-volunteer) MFB Metropolitan Fire and Emergency Services Board (Melbourne, Australia) MFB Medial Forebrain Bundle MFB Micro Finance Bank ) and the development of SHR'ewd (R) (Steel Hybrid Riser for Extended Water Depth), a new riser for ultra-deepwater. As a result of increased bidding costs related to projects which should be awarded in 2000, selling expenses were up 11% to Euro 25.2 million. Administrative expenses remained flat at Euro 55.1 million. Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. increased 8% to Euro 48.5 million (US$ 48.7 million), compared to 1998. The increase is due to the improved performance of Oil and Gas Contracting and includes goodwill amortization for Euro 0.7 million arising from the Sofresid acquisition. Financial income, primarily consisting of interest income of Euro 7.1 million, increased from Euro 4.0 million in 1998 to Euro 9.4 million in 1999. Non-recurring other income totaled Euro 1.5 million due to the profit made on the sale of BOS Australia. Business segment analysis --------------------------------------------------------------------- In million Euro 1998 1999 --------------------------------------------------------------------- Net sales --------- Oil & Gas Contracting 613.3 728.9 Maintenance Services 145.6 124.6 Maritime and River Works 70.9 71.8 Liquefied Gases 20.0 8.5 Chemical, refining, energy and industries - 49.9 Operating income ---------------- Oil & Gas Contracting 40.0 46.3 Maintenance Services (0.4) 2.7 Maritime and River Works 4.1 (0.5) Liquefied Gases 1.1 0.2 Chemical, refining, energy and industries - (0.2) --------------------------------------------------------------------- Oil & Gas Contracting sales increased 19% as a result of the large contracts in progress. Operating income increased 16% from Euro 40.0 million to Euro 46.3 million in 1999. The improvement in operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: was especially strong during the first half of 1999, when contracts (OSO OSO Onsala Space Observatory OSO Orbiting Solar Observatory OSO Office of Satellite Operations (US Department of Commerce, NOAA) OSO OverScan Operation (VXA Technology) 2Y2 for Mobil in Nigeria, Kombi Likalala for Elf elf, in Germanic mythology, a type of fairy. Usually represented as tiny people, elves are said to dwell in forests, in the sea, and in the air. Although they can be friendly to man, they are more frequently vengeful and mischievous. in Congo, Zafiro for Mobil in Equatorial Guinea Equatorial Guinea (gĭn`ē), officially Republic of Equatorial Guinea, republic (2005 est. pop. 536,000), 10,830 sq mi (28,051 sq km), W central Africa. and Bleo Holm holm n. Chiefly British An island in a river. [Middle English, from Old Norse h for Bluewater in Scotland) were in their phase of completion. More significantly, the Company had a number of important contracts in their starting phase during the second half of 1999. Utilization of the Company's main barges decreased compared to 1998 (232 days for the BOS 355 and 190 days for the Castoro Otto Otto, Austrian archduke Otto: see Hapsburg, Otto von. in 1999, compared respectively to 316 days and 332 days in 1998). Yards incurring in·cur tr.v. in·curred, in·cur·ring, in·curs 1. To acquire or come into (something usually undesirable); sustain: incurred substantial losses during the stock market crash. 2. fixed costs fixed costs, n.pl the costs that do not change to meet fluctuations in enrollment or in use of services (e.g., salaries, rent, business license fees, and depreciation). (Clydebank and Congo) were occupied principally during the first half of 1999. Net sales of the Maintenance Services segment decreased 14% resulting from the sale of BOS Australia, which had an important activity in piping. However the Company's selective marketing policy targeting value added Value Added The enhancement a company gives its product or service before offering the product to customers. Notes: This can either increase the products price or value. projects, resulted in positive operating income of Euro 2.7 million in 1999, compared to an operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. in 1998. Net sales in the Maritime INTEREST, MARITIME. By maritime interest is understood the profit of money lent on bottomry or respondentia, which is allowed to be greater than simple interest because the capital of the lender is put in jeopardy. and River Works segment reached Euro 71.8 million, reflecting the progress of the Beirut contract, as well as the start of Pointe pointe n. In ballet, dancing that is performed on the tips of the toes. [From French pointe (des pieds), point (of the feet), tiptoe; see point.] des Grives in Martinique and Monaco dike Dike, in Greek religion and mythology Dike: see Horae. dike, in technology dike, in technology: see levee. dike Bank, usually of earth, constructed to control or confine water. project. Operating income included a provision for a doubtful account totaling Euro 3.6 million. Liquefied Gases net sales remained very low due to the completion of projects. Nonetheless, due to the segment's low level of fixed costs in this segment, it had positive operating income of Euro 0.2 million. Chemical, refining refining, any of various processes for separating impurities from crude or semifinished materials. It includes the finer processes of metallurgy, the fractional distillation of petroleum into its commercial products, and the purifying of cane, beet, and maple sugar , energy and industries segment broke even with sales of Euro 49.9 million. Geographical analysis ---------------------------------------------------------------- % of Net sales 1998 1999 ---------------------------------------------------------------- France 12.6 15.0 Europe - Central Asia 34.0 28.6 Africa 39.8 50.8 Northern Africa - Middle East - 0.5 Americas 6.4 3.0 Asia/Pacific 7.2 2.1 ---------------------------------------------------------------- As a result of the two Girassol projects, Africa continues to represent the largest portion of net sales for the Company. Europe - Central Asia primarily reflects the two CPC (1) (Central Processing Complex) An IBM mainframe that has two or more central processors (CPs) that share memory. It is the collection of processors, memory and I/O subsystems manufactured with a single serial number, typically all contained in one cabinet. projects in Russia as well as Sofresid's activity in Iran. The activity in the Americas in 1999 relates to pipe laying projects in the Gulf of Mexico Noun 1. Gulf of Mexico - an arm of the Atlantic to the south of the United States and to the east of Mexico Golfo de Mexico Atlantic, Atlantic Ocean - the 2nd largest ocean; separates North and South America on the west from Europe and Africa on the east (Mexico). Northern Africa - the Middle East is a new area of activity for Bouygues Offshore. The Company is represented by the commercial presence of Sofresid, especially in Algeria. There were no new projects launched in Asia due to the economic crisis that impacted the region. Capital expenditures Consolidated capital expenditures for 1999 totaled Euro 96.4 million, increasing from Euro 27.4 million in 1998. 1999 capital expenditures included maintenance related investments, Euro 31.3 million related to the second phase of the investment in the Field Development Ship and the acquisition of Sofresid (Euro 45.8 million). Balance sheet highlights Cash and cash equivalents increased 11% to Euro 231.9 million at December 31, 1999, compared to Euro 209.2 million at the end of 1998. Outlook Herve Le Bouc, Chairman, commented : "Our backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. increased 30% over 1998 to Euro 903.3 million. 84% of this backlog is expected to be performed in 2000, and combined with commercial prospects, current contracts structure and the possible entry into force of the Blue Stream project (US$ 300 million signed on November 24, 1999) in the first half of 2000, we are comfortable estimating that 2000 revenue will increase approximately 7%". Appointment of Jacques Leost as Managing Director and COO (Cell Of Origin) See mobile positioning. Jacques Leost has been appointed Managing Director and Chief Operating Officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. by the Board of Directors. Jacques Leost, 48 years old, joined Bouygues Offshore in 1976. He was successively project engineer in Angola, Managing Director of Petromar (Angolese subsidiary of Bouygues Offshore), Managing Director of Solbos (Norwegian Norwegian associated in some way with Norway. Norwegian buhund, Norwegian sheepdog a medium-sized (26-40 lb), spitz-type dog with a short, dense coat in wheaten, black, red or sable, sometimes with black markings on the face, ears subsidiary of Bouygues Offshore), Vice President Nigeria and Senior Vice President Africa, North Sea and Mexico. He was Chief Operating Officer since 1996. Board Nominations The Board agreed to nominate nom·i·nate tr.v. nom·i·nat·ed, nom·i·nat·ing, nom·i·nates 1. To propose by name as a candidate, especially for election. 2. To designate or appoint to an office, responsibility, or honor. Olivier Bouygues, Group Director Utilities of Bouygues, as a director. His election at the general shareholders meeting would increase the number of seats on the Board to ten. Dividend The Board of Directors agreed to propose for approval at the general shareholders' meeting shareholders' meeting n. a meeting, usually annual, of all shareholders of a corporation (although in large corporations only a small percentage attend) to elect the Board of Directors and hear reports on the company's business situation. to be held on May 18, 2000, the payment of a net dividend of Euro 1.3 per share (Euro 0.65 per ADS). The record date and payment date will be May 26, 2000. Note : All amounts disclosed in Euro have been calculated using an exchange rate of Euro 1 = FF 6.55957 Driven by a strong commitment to the energy industry, a growing global presence, and a team of talented professionals, we deliver solutions that are safe, innovative, and promote the success of our clients and our Company. This release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that involve a number of risks and uncertainties, notably in the section outlook above. Although the Company believes that backlog is a reasonably reliable indicator of future net sales, postponements or cancellations of previously awarded contracts or delays in the completion of ongoing projects could negatively impact net sales. In addition to the impact of backlog, among the other factors that could cause the Company's actual net sales to differ materially from those estimated are the following : fluctuations in the level of oil and gas industry spending; the Company's ability to obtain additional contracts in 2000 and commercial prospects not translating into firm orders or sales; risks involved in doing business abroad (such as civil disturbances Group acts of violence and disorder prejudicial to public law and order. See also domestic emergencies. , adverse government actions and economic and governmental instability instability /in·sta·bil·i·ty/ (-stah-bil´i-te) lack of steadiness or stability. detrusor instability ); risks of loss of its two largest barges; and fluctuations in exchange rates (primarily the US dollar versus the Euro) and risks involved in the execution of contracts.
SUMMARIZED FRENCH GAAP CONSOLIDATED FINANCIAL STATEMENTS
Consolidated income statement
---------------------------------------------------------------------
In millions 1998 1999 1999
Euros Euros US$
---------------------------------------------------------------------
Net Sales 849.8 983.7 988.2
Cost of sales (722.8) (849.2) 853.1
Gross margin 127.0 134.5 135.1
R&D (3.9) (5.7) (5.7)
Selling expenses (22.8) (25.2) (25.3)
Administrative expenses (55.5) (55.1) (55.4)
Income from operations 44.8 48.5 48.7
Financial income 4.0 9.4 9.4
Non-recurring income (0.1) 1.5 1.5
Income tax (7.4) (8.4) (8.4)
Share in net income
of equity affiliates 1.0 1.2 1.2
Minority interests 0.0 (0.1) (0.1)
Net income 42.3 52.1 52.3
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Net income per share(a) 2.50 3.11 3.12
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Net income per ADR 1.25 1.55 1.56
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(a) Based on the weighted average number of shares outstanding in the
period (116,914,521 in 1998 and 16,753,103 in 1999)
Consolidated balance sheet (in millions)
----------------------------------------------------------------------
Assets 1998 1999 1999 Liabilities 1998 1999 1999
Euros Euros US$ Euros Euros US$
----------------------------------------------------------------------
Fixed
assets 89.7 159.4 160.1 Shareholders'
equity 143.6 176.2 177.0
Minority
interests (0.1) (0.0) (0.0)
Current
assets 277.9 466.3 468.5 Accrued contract
costs and
other
provisions 67.7 119.1 119.6
Own shares 8.1 8.1 8.1 Financial debt 28.4 34.2 34.4
Cash and
cash equiv. 209.2 231.9 233.0 Current
liabilities 345.3 536.2 538.7
----------------------------------------------------------------------
Total Assets 584.9 865.7 869.7 Total
Liabilities 584.9 865.7 869.7
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Consolidated cash flow statement (in millions)
----------------------------------------------------------------------
1998 1999
Euros Euros
----------------------------------------------------------------------
Net cash provided by operating activities 66.7 95.7
Net cash provided by (used in) investing activities (35.0) (64.0)
Net cash provided by (used in) financing activities (17.2) (23.1)
Net effect of exchange rate changes (6.2) 14.1
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Net increase (decrease) in cash and cash equivalents 8.3 22.7
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BACKLOG (in million euro)
----------------------------------------------------------------------
Dec. 31 1998 Dec. 31 1999
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Oil & Gas Contracting 585.4 777.6
Maintenance Services 38.3 27.5
Maritime & River Works 66.5 33.7
Liquefied Gases 7.0 3.0
Chemical, refining, energy and industries - 61.5
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(1) Based on an exchange rate of Euro 1 = US$ 1.0046, which was the
European Central Bank reference rate on December 30, 1999
(2) Including amounts of approximately Euro 66.1 million in 1999 and
Euro 41.9 million in 1998, that represent operating costs billed
directly to single project joint ventures or reimbursable expenses
billed to customers, neither of which generate operating income.
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